Currently reading: Jaguar Land Rover and Tata Steel UK bailout talks end
No emergency funding on cards for JLR, claims Financial Times, with firm refusing to accept requirements to further accelerate electrification
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2 mins read
17 August 2020

Talks between Jaguar Land Rover (JLR), Tata Steel and the UK government over a proposed bailout to mitigate the impact of the pandemic have fallen through, the Financial Times reports. 

The talks, which aimed at securing government support under the UK's Project Birch plan to bail out strategically important companies, are said to have ended because JLR didn't meet the requirements to qualify for taxpayer support. 

However, the report also suggests JLR management was unwilling to meet requirements to decarbonise its fleet further in order to obtain financial support. The requirements would've meant a significantly accelerated electrification plan and the need to phase out diesel engines (both brands' core propulsion method in terms of sales) far sooner. 

Tata Steel, a subsidiary of JLR parent company the Tata Group, said in a statement that it "remains in ongoing and constructive talks with the UK government on areas of potential support". However, the Project Birch funding scheme is said to unfeasible for the firm, due to the conditions companies have to meet to qualify for it. JLR has yet to respond to the report. 

JLR recently reported a "significant impact" from the pandemic and associated lockdowns in its quarterly results. Sales volumes fell by more than 42% year on year from March to the end of June, and a £413 million loss was reported. 

As a result, the company has increased its cost reduction target by another £1 billion to £2.5bn for this full financial year. However, JLR also notes "particularly encouraging" sales recoveries in China and North America, while 98% of its global plants have resumed production.

READ MORE:

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16

17 August 2020
Spectacularly nearsighted. Diesel is being banned in city centers, where do they think these cars are driven 99% of the time?

17 August 2020
Good from them. I appreciate a company that won't do the politicians bidding. A company with a backbone I will supports.

17 August 2020
Billnyethescienceguy wrote:

Good from them. I appreciate a company that won't do the politicians bidding. A company with a backbone I will supports.

Explain please?

They effectively want tax payers money to bail them out. The money would go to either shore up the finances, or to continue developing heavy, inefficient, and fossil fuel vehicles - kind of the wrong direction for long term viability for a car maker. I'd rather my money went on cleaner developments for the future.

 

Ipace a great looking car, and by all accounts a very good car, but too expensive though. Why can't they make a £40k car to compete with Tesla? LR/RR will be basket cases in 5 years if they don't change direction, and Jaguar is barely alive for ongoing development costs. A company in huge trouble, that needs to be bought by an existing large player 

17 August 2020
Paul Dalgarno wrote:

Billnyethescienceguy wrote:

Good from them. I appreciate a company that won't do the politicians bidding. A company with a backbone I will supports.

Explain please?

They effectively want tax payers money to bail them out. The money would go to either shore up the finances, or to continue developing heavy, inefficient, and fossil fuel vehicles - kind of the wrong direction for long term viability for a car maker. I'd rather my money went on cleaner developments for the future.

 

Ipace a great looking car, and by all accounts a very good car, but too expensive though. Why can't they make a £40k car to compete with Tesla? LR/RR will be basket cases in 5 years if they don't change direction, and Jaguar is barely alive for ongoing development costs. A company in huge trouble, that needs to be bought by an existing large player 

Couldn't agree more! ..."or to continue developing heavy, inefficient, and fossil fuel vehicles" you forgot to say expensive, niche and mostly luxury vehicles. I don't want my taxes going on providing subsidised stinky diesel posh cars for those that can afford to pay for them themselves.

I would rather it gets distributed to keeping vastly more low pay workers in their jobs such as as the eat out scheme so they can put food on their own tables.

Sadly I think JLR will be gone within the next 6 to 8 years, maybe sooner. failure to evolve, its nature.

 

17 August 2020

Like it or not, the future is electric. JLR has always struggled with engines and drivetrains, because of it's lower volumes, it's always been buying them in and adapting. Electric is a chance for them to make a leap forward and if that's the price of getting more cash to invest, then grab it with both hands. An opportunity missed.

I very much doubt I'll ever buy another new ICE car, with the rate of progress that BEV's are showing, and that's from an F-Type driver who paid at least £10,000 just for the noise!

17 August 2020

France, Germany, Italy & even Spain helped it's car industry through this very difficult period. What does Boris's bunch of B** chums do??? Nothing to help the UK car industry, just 50% food vouchers!!!! It's rediculous, no forward thinking for industry. 

17 August 2020

Short term thinking, services based economy. Started when Maggie closed coal and steel industry and has continued ever since. Now they are chucking money at keeping barista jobs while letting actual industry continue to decline. Started a long time ago, and although it's worse under the tories the labour years didn't reverse the trend.

Boris has no concept of long term industrial planning neither does he care. The way the city works, the way our economy works, it's all about the short term unfortunately.

17 August 2020
jagdavey wrote:

France, Germany, Italy & even Spain helped it's car industry through this very difficult period. What does Boris's bunch of B** chums do??? Nothing to help the UK car industry, just 50% food vouchers!!!! It's rediculous, no forward thinking for industry. 

Probably better to ask, what forward thinking did JLR do to help themselves?... not a lot.  Just continued building overweight, over engineered 'premium' vehicles with no platfrom strategy, feasting on the short term profit they offered and when the time of need arises, such as now, there's no resilience in their business case.  Perhaps TATA could reveal if they took any of the profits from the last few years, where those profits went, or was it all ploughed back into the business to build it?  I doubt it. 

So who's fault is it JLR are in the state they are in?  And why should MY money go to helping them out?  Should TATA have to financially prop up it's mismanaged UK operation, yes it should. Should MY money go to a mismanaged business to save thousands of UK and European jobs, yes it should, because long term it's far cheaper to do that than it is for them to be out of work, but that should come with conditions, conditions that mean, we get a piece of that company or any future profits.  Perhaps TATA didn't like that part...

Many European Governments helped out their industries because they still own large parts of them, or have shared financial interests, so it's their duty to help them out.

17 August 2020
jagdavey wrote:

France, Germany, Italy & even Spain helped it's car industry through this very difficult period. What does Boris's bunch of B** chums do??? Nothing to help the UK car industry, just 50% food vouchers!!!! It's rediculous, no forward thinking for industry. 

My eyes popped out of my head reading that. Erm, we paid 80% of the workers wages whilst production stopped? Spain...  well they certainly need help given the factories they're loosing. Germany have lost many automotive jobs this year and as for the Italians, well they're up the creek without a paddle right now.

Nothing to help JLR? I'd have thought the millions the British taxpayer pumped in to British Leyland would have been a lesson why we should keep well clear. 

And of course if you read the story, Boris and his chums did not turn their back, they laid down conditions which according to the story, JLR wouldn't meet. For once I agree with this gov.

17 August 2020
"firm refusing to accept requirements to further accelerate electrification"
After they have bet the house on the diesel, it's understandable.
No worries, the world will not end without JLR but it might end with their dirty tanks on the roads.

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